River Falls journal. [volume] (River Falls, Pierce County, Wis.) 1872-2019, 1887-12-08
PRESIDENTS MESSAGE.
Devoted to the Consideration of
the Tariff and Surplus.
Urging the Necessity of a Revision of the
Revenue as the Only Remedy for d
Dangerous Evil-Methods Suggest
ed by the Executive.
FULL TEXT OF TIE MESSAGE.

sage, as read TO both houses of Congress to-
day:
To THE CONGRESS OF THE UNITED STATES
You are confronted at the threshold of your
legislative duties with condition OF the Ma
tional finances which impcratively demands inn
mediate and careful consideration.
The amount of money annually exacted
through the operation of present laws. from the
industries and necessities OF the people, largely
exceeds the sum necessary 10 meet the expenses
OF the Government
When we consider that the theory of our IN
sltutions guarantees 10 every citizen ths full
enjoyment OF all the fruits OF his industry and
enterprise, with only such deduction as may
be his share toward the careful and economical
maintenance of the Government which pro-
tects him, II is plain that the exaction OF more
than this is indefensible extortiOn, and a culpa-
bic betrayal OF American fairness and justice
This wrong, int .cted upon those who
bear the burden OF National taxation, like
other wrongs, multiplies q brood OF evil couSe-
quenees- The public treasury, which should
only ex 81 as "a conuuit conveying the people
tribute 10 It's legitimate objects OF expenditure,
becomes Interchangeable Tor money ueedlessly
Withdrawn from trade and the peoples use
thus Gripping our National energies, suspend
ing our cOuntry's development, preventing in
vestment In productive enterprises, threaten
ing financial disturbance and inVltir schemes
OF public plumber. This condition OF our
Treasury is not altogether new; and IL has
more than once of late been submitted TO the
peoples representatives IN Congress, who
alone can apply a remedy And yet the situa-
ton still continues, with aggravated Incidents
more than ever presaging financial commissions
II will not do 10 neglect this situation be-
cause its dangers are not now palpably immi-
nent and apparent. They exist none the less
certainly, and await the unforeseen, unex-
pected occasion when suddenly they will be
precipitated upon us.
On the 3lth day OF June, 1885, the excess of
revenues over public expenditures, after COM
plying with the annual requirement of the
Sinking-fnnd act. was all S59 735 "a: during The
year ended June 30, 1865, such excess amounted
10 $40, 4O554j.20, and during the year ended
June 80, 1887, il reached the sum OF SIS 567, s49
81
The annual contributions 20 the sinking fund
during the three years above specified amount
ing in the aggregate to abs go 81, and de-
Quoted from the surplus as stated, were made
by calling in for that purpose outstanding per
cent. bonds OF the Government. During the six
months prior 10 June 30, 1887, the surplus rev.
enue had grown so large by repeated accumu-
lations, and IL was feared the withdrawal OF this
great sum of money needed by the people, would
so afect the business OF the country that the sum
OF a7S 1854, 40 OF such surplus was applied 10 the
payment of the principal and interest OF the
per cent. bonds still outstanding, and VIII CHI
were then payable at the option of the Govern
ment The precar.ous condition of financial
AFFAIRS among the people still needing relief
Immediately after the Both day OF June. 1884,
the remainder of the per cent. bonds then
outstanding, amounting, with principal and in
terest, TO the sum of sl8677,J 800, were called in
and applied to the sinking-fund contribution
for the current fiscal year Notwithstanding
these operations OF the Treasury Depart
ment representations Of distress in
business circles not only continued
hand. In these circumstances the contribution
to the sinking fund for the urlent fiscal year
was at once completed by the expend ture of
S27, 6s4, 3.55 in the purchase of Government
bonds not yet due being and "a per cent. inter
est, the premium pa d theron averaging about "a
per cent for the former and per cent for the
latter In addition TO this the interest aceruing
during the current year upon the outstanding
bonded indebtedness of the Government was TO
some extent anticipated, ana banks selected as
depositOr es of public money were permitted to
somewhat increase their deposits.
While the expedlents thus employed to re-
lease TO the people the money lying idle in the
treasury served TO avert immediate danger, our
surplus revenues have continued to accumulate
the excess for the present year amount ng on
the first day of December TO 1862 $50. 10, and
est mated to reach the sum OF s1l3O00,OO0 on
the 59th OF June next, at which date it is ex-
pected that tn sum. added TO prior accumula-
tons VIII, swell the surplus in the Treasury 10
S14OO0,OOO.
There seems TO be no assurance that with
such withdrawal from use of the peoples
circulating medium our business may not in
the near future be subjected TO the same
distress which was quite lately produced
lions of our National Treasury should be
few and simple, and while its best con-
S Sy its entire dsconnecton with iiI pr
vate business interests, yet when, by perver
sion OF its purposes, it idly holds money use
lessly subtracted from the channels OF trade,
there seems to be reason Tor the claim that
some legitimate means should be devised by
without waste or extravaganza, such money to
its place among the people.
If such an emergency arises there now exists
no clear and undoubted executive power of re-
lief Heretofore the redemption Of per cent
bonds which were payable at the option of the
Government, has afforded means for the dis
bursement OF the excess OF our revenues; but
these bonds have all been retired, and there are
no bonds outstand ng the payment of which we
have the right to insist upon, The contriou-
cason for expenditure in the purchase of bonds
has been already made for the current year, so
there is no outlet in that direction.
In tho present state OF legislation the only
pretense Of any existing executive power TO re-
store at this time any part of our surplus rev.
enues to the people by its expenditure, cons SITS
in the supposition that the Secretary of the
Treasury may enter the market and purchase
the bonds Of the Government not yet due, at
rate of premium to be agreed upon.
The only provision OF law from which such
power could be derived is found in an appropri-
alton bill passed a number of years ago; and il
is subject 10 the suspic on that il was intended
as temporary and limited in its application, in
stead OF comforting continuing discretion and
authority. No condition ought TO exist which
would Justify the grant of power 10 single
off1cial, upon his judgment OF its necessity, TO
withhold from or release 10 the business
OF the people, In an unusual manner, money
held in the Treasury, and thus affect, at his
will, the financial situation of the tOuntry; and
II Il is deemed wise to lodge IN the Secretary OF
the Treasury the authority in the present lunct-
ure to purchase bonds, IL should be plainly
vested and provided, as far as possible with
such checks and limitations as will define this
officials right and discretion and at the same
time rel eV him from undue responsibility.
In considering the question of purchasing
the surplus money accommodating in the Treas
ury il should be borne in mind that premiums
must of course be paid upon such purchase,
that there may be large part of these bonds
held as investments which car not be pur-
chased at any price, and that complications
among holders who are willing 10 sell may I'M
reasonably enhance the cost OF such bonds TO
the Government
Ithas been suggested that the present bond
ed debt n. ght be refunded al less rate OF IN
terest and the Inference between the old ana
new securities paid in cash, thus finding use
for the surplus in the Treasury. The success
of this plan, IL is apparent. must depend upon
the yolition OF the holders of the present bonds;
and il is not entirely certain that the induce
ment which must be offered them would re-
suit in more financial benefit to the Govern
ment than the purchase OF bonds, while the lat
ter proposit on would reduce the principal OF the
debt by actual payment, instead OF extendingit.
The proposition to deposit the money held by
the Government in ban IS throughout the cOun-
try for use b. the people IS, II seems 70 me,
exceedingly objectionable in lrineiple as es-
tablishng too close relationship between the
operat ons OF the GOvernmeIt treasury and
the business of the country, ana too extensive
aco-mingltng OF their money, thus fostering an
unnatural reliance in private business upon
public funds. II this scheme should be adopt
ed il should only be done as a temper ry
exped'ent to meet an urgent necessity. Legis-
lative and executive effort shoulc generally be
IN the Oppos te direction, and should have a ten
dency to divorce. as much and as fast as can
Safely ne done. lne treasury DSptAtnSHt AloHi
pr vate enterprise.
OF course il is not expected that unnecessary
and extravagant appropriations will be made
for the purpose Of avoiding the accumulation
OF an excess of revenue. Such expenditure,
beside the decentralization Of all Just co1c6p-
lions of public luty which il entails, stimulates
a habit of reckless iInproy idence not In the
least consiste NJ with the mission OF our people
or the high and beneteent purposes OF onr
Government,
have deemed il my duty 70 thus bring 70 the
knowledge OF my countrymen, as we'll as 10 the
attention Of their represe natives charged with
the responsibility OF legislative relief the
OF The Congress heretofore TO provide against
the dangers which IL was quite evident the
very nature OF the difficulty must necessarily
produce, caused a condition OF financial dis
tress and apprehension since your last adj
journment which taxed TO the utmost all the
authority and expedents within executive con
troll: and these appear now to be exhausted
II disaster results from the continued inaction
of Congress the responsibility must rest where
IL belongs.
Though the situation thus far considered IS
fraught with danger which should be fully
realized, and though it presents features OF
wrof 10 the people as well as peril 10 the
country. II is but result growing out Of per-
fectiy palpable and apparent cause constantly
reproducing the same alarming circumstances
"a congested National treasury and depicted
monetary condition IN the business OF the eoun-
try = need hardly be stated that, while the
present situation demands a remedy we can
only be saved from a ike predicament in the
future by the removal OF its cause
Our scheme OF taxation, by means OF which
this needless surplus is taken from the people
and put into the pu lie treasury consists OF a
tariff OF duty evied upon importatons from
abroad, and acknowledgements taxes levied upon
Oft